Do we need a new terminology in offshore outsourcing?
The past years I have been thinking regularly about the terminology in the offshoring world. The market has come up with a huge list of terms like:
– Offshoring
– Offshore outsourcing
– Nearshoring
– Nearshore outsourcing
– Captive center
– Outsourcing
At the end of the day, my impression is that they are all describing one general thing: moving work to another country. Maybe we have made the terminology too complex? When I speak to people that have no knowledge or relation to offshoring at all, they generally think of oil platforms. Is that what we want as an industry?
I am more and more comparing our business to employment agencies. In the Netherlands we have many employment agencies and staffing agencies. One of the biggest is Randstad. This company was started by a single entrepreneur who explored the flexibility of the labor market in the Netherlands.
The past years I have been thinking regularly about the terminology in the offshoring world. The market has come up with a huge list of terms like:
– Offshoring
– Offshore outsourcing
– Nearshoring
– Nearshore outsourcing
– Captive center
– Outsourcing
At the end of the day, my impression is that they are all describing one general thing: moving work to another country. Maybe we have made the terminology too complex? When I speak to people that have no knowledge or relation to offshoring at all, they generally think of oil platforms. Is that what we want as an industry?
I am more and more comparing our business to employment agencies. In the Netherlands we have many employment agencies and staffing agencies. One of the biggest is Randstad. This company was started by a single entrepreneur who explored the flexibility of the labor market in the Netherlands.
The past years I have been thinking regularly about the terminology in the offshoring world. The market has come up with a huge list of terms like:
– Offshoring
– Offshore outsourcing
– Nearshoring
– Nearshore outsourcing
– Captive center
– Outsourcing
At the end of the day, my impression is that they are all describing one general thing: moving work to another country. Maybe we have made the terminology too complex? When I speak to people that have no knowledge or relation to offshoring at all, they generally think of oil platforms. Is that what we want as an industry?
I am more and more comparing our business to employment agencies. In the Netherlands we have many employment agencies and staffing agencies. One of the biggest is Randstad. This company was started by a single entrepreneur who explored the flexibility of the labor market in the Netherlands.
The past years I have been thinking regularly about the terminology in the offshoring world. The market has come up with a huge list of terms like:
– Offshoring
– Offshore outsourcing
– Nearshoring
– Nearshore outsourcing
– Captive center
– Outsourcing
At the end of the day, my impression is that they are all describing one general thing: moving work to another country. Maybe we have made the terminology too complex? When I speak to people that have no knowledge or relation to offshoring at all, they generally think of oil platforms. Is that what we want as an industry?
I am more and more comparing our business to employment agencies. In the Netherlands we have many employment agencies and staffing agencies. One of the biggest is Randstad. This company was started by a single entrepreneur who explored the flexibility of the labor market in the Netherlands. At that time, the labor market was not flexible at all. The term that is today the default word describing the business that Randstad is in, is ‘uitzendbureau’ (agency sending out people). When this ‘movement’ started, I think the term was not invented yet (I have no historical proof for this, so I might be wrong!). If you ask a person on the street in the Netherlands if he knows what ‘uitzendbureau’ means, he will give you a picture perfect description of such company. Now offshoring in general is not using the same principle (except when people are sent from India or Eastern Europe to another country).
Another movement in the Netherlands (and other European countries) is ‘detachering’. I believe the English term would be ‘staffing’; the principle is that company A employs a person by normal employment contract and lets the person work in company B at a premium rate for a certain period (which can be ended flexibly). At Bridge we feel that this is the business we are in, the only difference is that the person is not sitting in company B’s office, but in another location (and country). I see many of our competitors/colleagues coming up with names as ‘virtual staffing’, ‘staffing from distance’, but I feel there are many different terms and not a single one is strong enough to be ‘the’ common term to describe our line of business.
Today, the term that gives me the biggest chance of another person understanding what business I am in is ‘outsourcing’. But from a definition point of view, outsourcing is much too broad. It can be used for anything that is done outside your companies boundaries (be it cleaning, providing lunch, IT, etc). Besides the service can be provide in the office, in the country or from another country.
Could we find 1 term describing our industry which has the strength to ‘stand out’, to make people understand immediately what your company is doing and that can develop offshoring/offshore outsourcing into a phenomenon that even my grandmother understands with 1 word?
At that time, the labor market was not flexible at all. The term that is today the default word describing the business that Randstad is in, is ‘uitzendbureau’ (agency sending out people). When this ‘movement’ started, I think the term was not invented yet (I have no historical proof for this, so I might be wrong!). If you ask a person on the street in the Netherlands if he knows what ‘uitzendbureau’ means, he will give you a picture perfect description of such company. Now offshoring in general is not using the same principle (except when people are sent from India or Eastern Europe to another country).
Another movement in the Netherlands (and other European countries) is ‘detachering’. I believe the English term would be ‘staffing’; the principle is that company A employs a person by normal employment contract and lets the person work in company B at a premium rate for a certain period (which can be ended flexibly). At Bridge we feel that this is the business we are in, the only difference is that the person is not sitting in company B’s office, but in another location (and country). I see many of our competitors/colleagues coming up with names as ‘virtual staffing’, ‘staffing from distance’, but I feel there are many different terms and not a single one is strong enough to be ‘the’ common term to describe our line of business.
Today, the term that gives me the biggest chance of another person understanding what business I am in is ‘outsourcing’. But from a definition point of view, outsourcing is much too broad. It can be used for anything that is done outside your companies boundaries (be it cleaning, providing lunch, IT, etc). Besides the service can be provide in the office, in the country or from another country.
Could we find 1 term describing our industry which has the strength to ‘stand out’, to make people understand immediately what your company is doing and that can develop offshoring/offshore outsourcing into a phenomenon that even my grandmother understands with 1 word?
At that time, the labor market was not flexible at all. The term that is today the default word describing the business that Randstad is in, is ‘uitzendbureau’ (agency sending out people). When this ‘movement’ started, I think the term was not invented yet (I have no historical proof for this, so I might be wrong!). If you ask a person on the street in the Netherlands if he knows what ‘uitzendbureau’ means, he will give you a picture perfect description of such company. Now offshoring in general is not using the same principle (except when people are sent from India or Eastern Europe to another country).
Another movement in the Netherlands (and other European countries) is ‘detachering’. I believe the English term would be ‘staffing’; the principle is that company A employs a person by normal employment contract and lets the person work in company B at a premium rate for a certain period (which can be ended flexibly). At Bridge we feel that this is the business we are in, the only difference is that the person is not sitting in company B’s office, but in another location (and country). I see many of our competitors/colleagues coming up with names as ‘virtual staffing’, ‘staffing from distance’, but I feel there are many different terms and not a single one is strong enough to be ‘the’ common term to describe our line of business.
Today, the term that gives me the biggest chance of another person understanding what business I am in is ‘outsourcing’. But from a definition point of view, outsourcing is much too broad. It can be used for anything that is done outside your companies boundaries (be it cleaning, providing lunch, IT, etc). Besides the service can be provide in the office, in the country or from another country.
Could we find 1 term describing our industry which has the strength to ‘stand out’, to make people understand immediately what your company is doing and that can develop offshoring/offshore outsourcing into a phenomenon that even my grandmother understands with 1 word?
At that time, the labor market was not flexible at all. The term that is today the default word describing the business that Randstad is in, is ‘uitzendbureau’ (agency sending out people). When this ‘movement’ started, I think the term was not invented yet (I have no historical proof for this, so I might be wrong!). If you ask a person on the street in the Netherlands if he knows what ‘uitzendbureau’ means, he will give you a picture perfect description of such company. Now offshoring in general is not using the same principle (except when people are sent from India or Eastern Europe to another country).
Another movement in the Netherlands (and other European countries) is ‘detachering’. I believe the English term would be ‘staffing’; the principle is that company A employs a person by normal employment contract and lets the person work in company B at a premium rate for a certain period (which can be ended flexibly). At Bridge we feel that this is the business we are in, the only difference is that the person is not sitting in company B’s office, but in another location (and country). I see many of our competitors/colleagues coming up with names as ‘virtual staffing’, ‘staffing from distance’, but I feel there are many different terms and not a single one is strong enough to be ‘the’ common term to describe our line of business.
Today, the term that gives me the biggest chance of another person understanding what business I am in is ‘outsourcing’. But from a definition point of view, outsourcing is much too broad. It can be used for anything that is done outside your companies boundaries (be it cleaning, providing lunch, IT, etc). Besides the service can be provide in the office, in the country or from another country.
Could we find 1 term describing our industry which has the strength to ‘stand out’, to make people understand immediately what your company is doing and that can develop offshoring/offshore outsourcing into a phenomenon that even my grandmother understands with 1 word?
Instead of terms like “distance” or “remote” or “afstands” … how about building from words about bringing together like “joint” or “aggregate” or “gezamenlijk”.
Do we really need new terminology?
– Offshoring
– Offshore outsourcing
– Nearshoring
– Nearshore outsourcing
– Captive center
– Outsourcing
I think there is a distinct difference between some of the used concepts. Some universities, and I am following that path, use offshoring (the question is whether the correct word is offshoring or off shoring) as a general concept for internationalization at large. In that case it includes import, export, licensing, (both ways) leasing, all kind of partnerships and alliances, including joint venture, etc .
That means that according to that understanding offshoring includes outsourcing and insourcing.
The word insourcing is often used when work is outsourced to another member-company in the same group; an transaction between companies that are owned by the same group.
Offshore-outsourcing therefore means outsourcing in another country. This in contradiction to having work done by another party in one’s own country which is also outsourcing, but not offshoring-outsourcing. Should we now introduce the word inshoring-outsorcing in order to differentiate between offshoring-outsourcing?
Near shoring: what is the difference between nearshoring and offshoring? When does nearshoring become offshoring? After 150 KM? 500 km? 1500km. If we use the word nearshoring we should also use the word farshoring. And drop the word offshoring? As longs as offshoring and outsourcing is not mixed up, the problem is controllable?
Captive offshoring describes an alliance whereby ownership is in hands of the oversea’s initiator. The multinationals such as Shell, Unilever, Genral Motors and the large banks go for this type of offshoring. According to my perception, captive offshoring only gives information on the shareholding , not really on the activity.
I wonder whether it is necessary to introduce a new vocabulary. It may add to the frustration that is there already. Wouldn’t it be better that we all try to use the right words in the correct setting?
May I add something to increase the frustration somewhat? What about free zones and maquiladoras? They may, but do not have to be an offshore variety. It can, but does not have to be a captive offshoring activity.
Instead of offering a solution for a problem, I rather contribute to the frustration so that somebody else gets a chance to put his finger on the weakness.
Thanks for your replies.
@ Phil: I like the direction ‘joint’ a lot, because in the end, the success of the whole operation depends on joint efforts. Only thing is how to get that ‘direction’ into a term describing the industry clearly?
@ Nick: I hope that you will get an insight one of these days and share the term that I am looking for?
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